With the resurgence of Greece back to the top of global news, incompetence and labor strikes charts (just like back in 2010 at roughly this time, which is to be expected since 2011 has been following the 2010 script to the dot) there has been far too little focus in the mainstream media on the family whose actions were responsible for Greece’s rise to glory and subsequent collapse into default. As Associates Press notes in its report the ruling family, “One family has dominated Greek politics for more than half a century: the Papandreous.” For all those who are wondering who the men behind the curtain, or as the case may be, front and center, are, the following expose is for you.

The Papandreous: Greece’s first family

One family has dominated Greek politics for more than half a century: the Papandreous.

A George Papandreou was in charge in the 1960s at a time of constitutional upheaval. And a George Papandreou rules now amid a financial crisis that threatens the nation with ruin.

With its coffers nearly empty, its people protesting and its political system under unprecedented attack, Greece stands on the brink of crisis as European officials prepare for a week of crucial meetings to avert economic collapse.

Fears that a debt-choked Athens could plunge global financial markets into turmoil are mounting as Germany and France edge closer to a new multibillion rescue package for the nation. Eurozone finance ministers are expected to give the green light to an emergency loan for the country when they convene for urgent talks in Luxembourg.

Thousands of Greeks protested outside parliament on Sunday against a fresh austerity package agreed in return for the country’s second bail-out in 13 months by the European Union and International Monetary Fund.

“Thieves, thieves … Where did our money go?” the protesters shouted, blowing whistles and waving Greek flags as riot police thickened ranks around the parliament building on Syntagma square in the centre of the capital.

Roll up, roll up, roll up. Elgin Marbles, Acropolis, Mykonos. Anyone? You don’t have to be an ancient Greek historian to understand the significance of it. But maybe it helps. For Thucydides, born back in 460 BC, the Port of Piraeus was the commercial heart of the Athenian democracy. “From all the lands, everything enters,” wrote the author of the History of the Peloponnesian War.

But now the port is up for sale – alongside the sort of assets even Thucydides would never have envisaged – in the biggest and most controversial privatisation Greece has ever seen.

Under pressure to raise €50bn as the quid pro quo for its massive €110bn (£98bn) bail-out, Greece is being forced to hawk its industrial and commercial backbone to the highest bidder.

Leaving aside for a moment the obvious questions of criminality and treason that have arisin from the details of the Memorandum of Understanding between the Greek government and the Troika (IMF/EU/ECB), which concedes total sovereign authority of the Greek state over the fate of its own citizens to foreign banks, let us turn to recent allegations made in Parliament against the Prime Minister of Greece himself, George Papandreou.

Recently, in an interview on Greek television, Member of Parliament for New Democracy, Mr. Panos Kammenos, made allegations that if true, could very well constitute treason for the Greek Prime Minister, members of his staff and possibly members of his own family. These allegations were repeated by Mr. Kammenos on the floor of parliament and given support by the leader of LAOS, Mr. George Karatzaferis. These allegations are therefore, not made lightly, and have now been plainly put forth before the Greek people. They can no longer be ignored, and the Prime Minister is obliged to respond to them.

The gist of the allegations rest on the charge by Mr. Kammenos, that the Greek Prime Minister, Mr. George Papandreou and members of his team, presided over the sale of 1.3 billion dollars worth of credit default swap contracts (CDS on Greek sovereign debt) on or around December of 2009, shortly after coming to power. The 1.3 billion dollars worth of insurance protecting against a Greek default was bought during the spring and summer of the same year, by the Hellenic Postbank, a public banking arm of the Greek government. It is unclear what the intentions of the Postbank were when it purchased the credit protection. Clearly, the previous government that was in power at the time (New Democracy or N.D.) understood that Greece was headed towards a fiscal crisis, otherwise they would not have purchased the insurance. However, we do not know if the move was initially made with the intention of reaping private profit, or simply as a hedge by the government itself against it’s own default.

[*Note: I have been made aware of a possible discrepancy between the numbers cited by Mr. Kammenos and those cited by Mr. Tombras in his law suit. Specifically, the subject at issue is the notional value of the CDS purchased and then sold by Hellenic Postbank. The size of the bank’s balance sheet would not warrant as large a hedge as the 60 billion in notional CDS (implied by Kammenos), which would imply that either the bank was net-short it’s own government’s debt, or that some mistake has been made by those looking over the books. This would affect the profit potential for the position, but would not change the fundamental fact that insurance protection was sold from public to private hands. – i.e. it has no bearing on the allegations]

Moody’s has angered the Greek government, including finance minister George Papaconstantinou, by slashing its credit rating to B1. Photograph: Louisa Gouliamaki/AFP

Portugal took a step nearer a humiliating multibillion-pound bailout by the European Union on Monday after Greece saw its credit rating slashed to a new low and speculation grew that eurozone leaders will fail this weekend to agree measures to prevent a repeat of last year’s sovereign debt crisis.

The ratings agency Moody’s cut Greece’s credit rating by three notches to B1, which analysts said was deep into “junk” territory, sending the cost of insuring the country’s debt soaring.

The downgrade, which was attacked as reckless and “completely unjustified” by the Greek government, highlighted the collapse in confidence among international investors who fear peripheral eurozone countries such as Greece, Portugal and Ireland cannot afford to repay their debts.

Greece, like Ireland, has already been forced to accept a rescue package put together by the EU and the International Monetary Fund. Portugal is widely regarded as the next country in need of a bailout as it struggles to refinance its debts while still in recession.

Somebody needs to probe the role of the banksters, the central bank and the government!

Greece plans parliamentary probe of foreign banks

Greece’s prime minister pledged Thursday that a parliamentary commission would examine the reasons behind Greece’s finance crisis and the role played by US banking giant Goldman Sachs, reports said.

Prime Minister George Papandreou told a press conference reserved for Greek media that the panel would be set up by the end of the year.

“In the context of this parliamentary commission on the economy … we are going to look into the participation of foreign institutions in the Greek problem,” he said in a report carried by the semi-official ANA press agency.

He added that the probe would look back as far as 2001, the year Greece entered the eurozone, and that among its targets would be Goldman Sachs.

Chinese sign multibillion euro contracts with Greece

Greece’s debt-ridden economy has received unexpected endorsement from China as the two countries announced multibillion euro accords to boost cooperation in fields as diverse as shipping, tourism and telecommunications.

The deals, which will see Greek olive oil being exported to China, were a welcome relief for a government smarting over Moody’s move hours earlier to downgrade the nation’s credit rating to junk.

As investors moved in the other direction, the world’s pre-eminent emerging economy embraced Greece. Signing the agreements, China’s vice premier Zhang Dejiang not only lauded Athens’ efforts to resolve its worst debt crisis in years but gave the eurozone’s weakest link a public vote of confidence, declaring it would soon come out of the woods.

“I am convinced that Greece can overcome its current economic difficulties,” said the politician who arrived in Athens with 30 of the economic power’s leading businessmen. “The Chinese government will encourage Chinese businesses to come to Greece to seek investment opportunities.”

Greek officials said the fourteen deals amounted to the biggest single investment by China in Europe. China views Greece as a “perfect gateway” to the continent and Balkan peninsular where Chinese exports have proliferated in recent years.

Under the agreement, Cosco, one of the world’s largest container terminal operators, will extend its reach with the construction of up to 15 dry bulk carriers in Greece. The company took over cargo management at Pireaus, the eastern Mediterranean’s premier dockyard, on a 35-year concession worth $1bn (£680m) last year.

The Chinese construction company BCEGI also signed an accord, thought to be worth €100m (£830m), to develop a hotel and shopping mall complex in Pireaus.

Other deals include the exchange of know-how between China’s Huawei Technologies and the Greek telecoms organization OTE and four agreements signed by food firms to export olive oil to China.

– Greek central bank hit by short claims (Financial Times):
A former European commissioner has accused Greece’s central bank of encouraging naked short selling of Greek bonds by altering the regulations on its electronic bond trading platform last year.

Vasso Papandreou, a senior deputy in the governing Socialist party, made the charges on Wednesday in a written question to parliament.

She said an extension of the settlement period and the abolition of penalties for failed bond trades had made it easier for speculators to short Greek bonds.

“The Bank of Greece knew the country’s negative fiscal situation. Why did it facilitate the speculation?” asked Ms Papandreou, who is not related to George Papandreou, the Greek prime minister.

Her question, supported by another 10 deputies, reflects growing concern in the Socialist party over an apparent policy contradiction in the handling of Greece’s debt crisis.

Mr Papandreou claimed the surge in spreads that resulted in Greece seeking a €110bn ($135.4bn, £94.4bn) bail-out last month from its eurozone partners and the International Monetary Fund was the result of sustained shorting of Greek bonds by unnamed speculators and hedge funds.

During a visit to the US earlier this year, he called for international sanctions against naked short selling.

The confusion in policy continued for months, although the prime minister regularly met George Provopoulos, governor of the Bank of Greece, and George Papaconstantinou, the finance minister, to discuss the handling of the country’s debt crisis.

The six-page question addressed to Mr Papaconstantinou set out details of measures taken by the central bank last year. The bank first extended the settlement period for transactions on HDAT, the bond trading platform, from Tplus3 (trading plus three days) to Tplus10.

The change was reportedly made in response to a request from the Association of Greek Banks, which represents market-makers in Greek bonds. But it gave short sellers a longer window of opportunity to push down the price of a Greek bond before delivering it on the settlement date, Ms Papandreou said. The central bank also abolished penalties for investors which did not deliver a bond on the settlement date.